Gov Snyder signs $1.2-billion road funding package

ALAIEDON TWP. Gov. Rick Snyder capped a four-year effort Tuesday when he signed into law a $1.2-billion road funding package that will hike fuel taxes and registration fees and also take $600 million a year from the state's general fund to fix and maintain Michigan's crumbling roads and bridges.

The package, narrowly passed by the Legislature on Nov. 3, has drawn praise from the Michigan Chamber of Commerce, which says better roads will help the state's business climate, and the Michigan Infrastructure & Transportation Association, which represents the road building industry and hosted Snyder's bill-signing ceremony.

"It's not just about asking for more revenue," Snyder said at the ceremony. "It's about investing in Michigan's future to create jobs."

Arriving at a deal was "hard work," he said, but lawmakers and others recognized "we need better roads in Michigan," and they were able to arrive at "a common sense, common ground solution."

The plan has been criticized by anti-tax groups, associations that say it will take money away from other priorities such as education and social services, and by Democrats, who released radio ads Tuesday attacking the plan.

The tax hikes don't kick in until 2017 and the plan doesn't devote a full $1.2 billion to transportation until 2021, although many motorists and interest groups say major road fixes are overdue and needed immediately.

Under the plan, the annual cost of a $100 vehicle registration will go up by $20, and the cost of a 15-gallon fill-up will increase about $1.17, when Michigan's 6% sales tax is applied on top of a 7.3-cent-per-gallon increase in the fuel tax, which is currently 19 cents per gallon. The package also increases the tax on diesel fuel, now 15 cents a gallon, to match the price of regular fuel and also increase to 26.3 cents per gallon in 2017. After that, the fuel tax will increase annually by 5% or by the inflation rate, whichever is less.

The plan also includes a sweetened Homestead Property Tax Credit under which more Michigan homeowners and renters will be eligible for credits of up to $1,500 a year, up from $1,200 currently. And it provides for an income tax rollback that would start in 2021 if Michigan's economy is showing sufficient growth.

Snyder signed just two of the bills -- the gas tax hike and the property tax credit relief -- at Tuesday's ceremony. But spokeswoman Sara Wurfel said he would be signing the entire package Tuesday. The package includes House Bills 4370, 4614, 4616, 4736, 4737, and 4738, and Senate Bill 417.

Michigan Democrats on Tuesday unveiled a series of radio ads attacking the plans that target Republican House members Dr. John Bizon of Battle Creek, Tom Barrett of Potterville, Jason Sheppard of Lambertville, and Holly Hughes of Montague.

“Every year on their birthday, Michigan drivers will be reminded of the increased registration fee which is the latest in a long line of Republican legislation that has taken money from everyday families and given it to big corporations and the top 1%,” House Democratic Leader Tim Greimel, D-Auburn Hills, said in a news release.

“To make matters worse, the increased taxes on families will not even fix our state's roads."

John Daly, manager director of the Genesee County Road Commission, who attended the bill-signing ceremony, said he'd like to see a larger package, but "it represents a good start."

"Nothing really comes to fruition until January of 2017, but you have to look at this as a long-term solution," Daly said. "We're better off today than we were yesterday."

Brandie Meisner, CEO of M&M Excavating in Gaylord, called the package "monumental," and said "it exemplifies another critical step in Michigan's comeback."